Glencore (GLN ) Head and Shoulder Trade plan

Head & Shoulders

We have a beautifully clear Head & Shoulders pattern on the Glencore share. H&S is one of the most reliable chart patterns.

 

 

The pattern completed on the 20th August 2020, as the market closed through the neck line. Triggering a short trade.

 

How I’m trading this

At the market open on 21st August 2020 I will place a sell stop order below the low of the trigger candle. My confirmation when trading a H&S pattern is a price trading below the low of the trigger candle.

 

Entry

Sell stop order at R38.09

 

Stop loss

Above the high of the right should at R40.63

Target

Length of the head projected downwards making my target R32

 

Risk

 

R40.36 – 38.09 = R2.27 

 

Position

 

 Equity as of market close 20 August 2020 R1065.35

 

2% = R21.31

 

Position = R21.31 / 2.27  = 9

 

Perfect Trade checklist

 

  1. Did I get the signal/trigger (Close below the neck line)
  2. Did I get confirmation (Trade below the low of trigger candle)
  3. Did I enter as per plan (Sell stop order)
  4. Did I set my stop loss at entry
  5. Did I set my position size correctly (2-3%)
  6. Did I monitor the trade correctly (adjust my stop accordingly using 2X ATR as a guideline)
  7. Did I exit as per plan (Stop or Target)

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